Taiwan's economic ministry expects semiconductor and display panel industries on the island to take a hit from the earthquake in Japan last week as supplies are suspended due to factory damage or transportation snarls, translating in some cases to higher manufacturing costs.

Local display-panel giants AU Optronics and Chimei-Innolux will see "a rather large impact" if Hitachi Chemical slows production of anisotropic conductive film, an epoxy that binds chips to glass or circuit boards, the ministry's Industrial Development Bureau said in a report late on Wednesday. Hitachi provides about 50 percent of the world's supplies of the film.

Semiconductor makers in Taiwan face a "fight to get raw materials" as 50 percent of the world's silicon wafer stock comes from two Japanese firms, Shin-Etsu and Sumco Corp., both affected by Friday's magnitude 9.0 quake, the bureau's report said.

The report echoed concerns expressed by economists and by the companies themselves.

"In terms of the ripple effect on the majority of our country's industries, it should come from flat screens, semiconductors and solar panels as they use of a lot of upstream materials and key components," the report said. "But the degree of impact needs to be monitored for each company's raw material stocks and whether they have a replacement source."

The ministry did not give a timeline for possible quake impacts or estimate how much they would end up costing local tech firms in Taiwan, which builds components and contracts to make PCs for the world's top brands.

Effects on supplies are hard to gauge partly because Taiwanese firms have found it hard to get information from Epson, Toshiba Semiconductor and others in the disaster area, the report said. But downstream chip makers will see costs rise if wafer stock dries up, the report said.